Long-Term Care and the 2020 Election
Medicare will pay for a heart transplant, and it will be charged something like $1.3 million for that procedure. Medicare also covers treatment for end-stage renal disease that costs over $90 thousand per year.
However, if an American living in the community develops early onset Alzheimers and needs monitoring for safety and assistance with meal preparation, personal hygiene, and dressing, Medicare will almost always ignore those needs. If an American of 85 in a nursing home has chronic conditions that require treatments and needs assistance as she or he bathes, dresses, and gets to the toilet, Medicare will almost assuredly ignore those needs as well, as it will for an individual living in an assisted living facility because of functional deficits caused by a health problem. Individuals like those noted above will, for the most part, be forced to become Medicaid recipients in order to pay for these services.
The same Medicare program that will make extraordinary expenditures for acute, outpatient, and rehabilitative care for an individual will ignore that same person’s need for long-term care (LTC). While some may think of LTC as largely a housing program, that view is uninformed. People seek LTC for the same reasons they seek primary care, hospital care, hospice, or medications. They use LTC (at home, in nursing homes, or in assisted living) because they have medical conditions that need care and that create a variety of disabilities or functional challenges.
If we truly desire high quality LTC for the most vulnerable among us, then the invisibility of LTC to Medicare should cease. Unfortunately, LTC reform has barely reached the radar for most Democratic primary candidates. Amy Klobuchar recently called LTC “the elephant in the room,” and some candidates have now at least mentioned LTC in their policy statements. None, however, have recognized that integrating LTC into Medicare offers the best solution for dealing once and for all with that lurking pachyderm.
Beyond the lack of logic for Medicare’s distinction between LTC and other forms for health care, a major problem with the invisibility of such needs to Medicare is that LTC, like transplant surgery or end-stage renal disease, is too expensive for most Americans. The average annual cost of a private room in a nursing home is just over $100,000, but in some states a private room cost over $150,000. Assisted living facilities (ALFs) are often seen as alternatives to NHs, but the charges in such places are still daunting. The median annual cost for a place in assisted living is $48,000, but those costs can go as high as $70,000. Unfortunately, as many older persons are discovering, the assisted living industry provides living space but often provides too little assistance.
Most recipients of long-term care are over 80 years of age, have multiple disabling conditions, are often cognitively impaired, frequently need physician or nursing services, and usually have no family on which they can depend for support or assistance. Ten thousand Baby Boomers turn 65 each day. However, what is distressing about our aging population in terms of long-term care is that by 2050 the 85+ population, the heaviest users of LTC, will represent roughly one-quarter of all those over 65, and it will be the fastest growing segment of the 65+ population.
What becomes crucial then is what today’s Boomers and later generations are saving for their retirement and how much they may have available for LTC. The unfortunate answer for Boomers is ―not much. Forty-five percent of Boomers have no retirement savings; approximately half of those with retirement savings have less than $100,000 put away. This means that roughly half of all Boomer retirees’ income and funds for LTC will depend solely on their social security benefits. Boomers are not alone in their lack of saving. Currently, 60 percent of Americans don’t have $500 in savings for an unplanned expense. Some indicators show that later generations may be saving somewhat more for retirement, but what those savings will do in terms of providing the LTC they may need in 50 years is a story that could easily have a sad ending.
Medicaid now pays for roughly half the costs of LTC. Our changing demographics and the shortfalls in retirement savings will make Medicaid an even more the crucial payor for LTC for more and more Americans. Unfortunately, Medicaid is a program built to provide care to those in or near poverty. For an older person to receive long-term supports and services from the Medicaid program, they must have a specified set of permanent disabilities, have an income near the poverty line, and divest themselves of most of their assets. That means that those seeking Medicaid for LTC must impoverish themselves in order to receive services. That is what has been done by over 60 percent of the approximately 1.3 million Americans in NHs, the 4.5 million recipients of Medicaid home care, and many of the over one million older persons in ALFs.
Social Security rescues over 15 million older Americans from living in poverty; the introduction of Medicare in the 1960s reduced poverty among older persons from 29 percent to 10.5 percent. So, Social Security and Medicare, universal coverage programs, played important roles in keeping frail, older Americans’ heads out of poverty. Meanwhile, Medicaid forces Americans who need LTC to impoverish themselves to enter a system that for decades has been well known for its host of problems in providing good quality of care.
One reason for the very well-documented quality problems in LTC is that the politics of long-term care is extraordinarily asymmetric. On one side of the political equation we have large profitable industries represented by very active and well-funded state and national associations that include wealthy providers and owners and employ powerful lobbyists. On the other side, we find volunteer not-for-profit organizations with very limited resources speaking out for clients who can’t advocate for themselves. It should be little surprise that legislators and the agencies they control are more responsive to industry concerns than to advocates calling for improved quality of care. The only way quality of long-term care can improve is if the politics of LTC change dramatically.
Moving LTC out of Medicaid and into Medicare will erase some good measure of the current political asymmetry. At a minimum that means LTC will no longer be an afterthought for advocacy groups like AARP, The National Committee to Preserve Social Security and Medicare, National Active and Retired Federal Employees Association, and the Center for Medicare Advocacy. Also, every member of Congress has someone in her or his offices responsible for helping constituents with issues surrounding Medicare. The reason is clear. Medicare recipients are among the age group (65+) with the highest rates of voter turnout. Also, Boomers, who see Medicare in their near future and those 65 or older constitute 49% of the electorate.
Unfortunately, candidates’ discussion of LTC is largely buried beneath the call for “universal” health care found in the policy statements of 2020 candidates. It was only in early 2019, two years after its first introduction, that Bernie Sanders, supported by Elizabeth Warren and other progressive senators, finally added an element of community based LTC to his Medicare for All bill. Elizabeth Warren went far enough to add NHs to her proposal. Unfortunately, this approach leaves those in persons living with disabilities in ALFs in “limbo,” even as that industry plays a larger and large role in providing LTC. Pete Buttigieg’s plan offers $90 a day for in-home services and tax credits to offset long-term care costs. Amy Klobuchar’s plan focuses on Alzheimers disease, supporting family caregivers, and assisting individuals to remain in their homes. While potentially useful, almost all these proposals have a somewhat half-baked, “oh, we better say something about LTC,” sense about them.
Fortunately, the version of Medicare for All recently introduced by Representatives Dingell and Jayapal with 100 co-sponsors (H.R. 1384) finally and fully abandons the pernicious distinction between LTC and other forms of health care. The bill brings long-term care into the Medicare program. Why should Medicare cover inpatient and outpatient care, no matter how expensive, and eschew responsibility for long-term care? Why should care for persons with chronic medical conditions, in the community and in residential care settings, be shoved off onto Medicaid? There is no logic to this distinction; it is an anachronism that needs to disappear.
Some will certainly argue that such a change would be too expensive. It is important to remember that the initial response to any healthcare reform is that it will cost too much. But reform in health care always costs too much ― until we decide to do it. A variety of funding strategies are available for moving LTC to Medicare. Some strategies will cost more than others. However, the basic question should not be cost. The basic question should be whether moving LTC into Medicare will improve the quality of life for millions of the most frail and vulnerable Americans.
The 2013 report of the U.S. Commission on Long-Term Care offered a series of what might be called “weak tea” policy recommendations for reforms in LTC. But, five members of that committee, representing advocacy groups, unions, and academic institutions, wrote an alternative report cogently arguing that LTC be included in Part A of Medicare. Hospice care was added as a Part A service; they make the same reasonable suggestion for LTC. Like acute and primary care costs for Medicare recipients, these experts want to spread the costs of LTC across the entire population, as we do in other social insurance programs, and they offer a set of financing alternatives to support this reform.
Medicare was created because policymakers saw that that costs of medical care was too great for most older Americans. The same now holds true for LTC. The winner of the 2020 election has an opportunity to remake and strengthen long-term services and supports by putting them where they belong ― in the universal health insurance program that has served older and vulnerable Americans so well for over half a century.
Well said, Charles. As that time in mine and Larry’s life looms, we do not look forward to a) any debilitating condition; b) LTC insurance premiums reach a level we cannot pay; c) being dependent on others to take care of us; and the worst, d). Becoming an LTC ‘resident’ Best to Catherine.